February 2012

February 29, 2012

So, if user-generated content is really just a lot of consumer masturbation, what is happening on the brand side of the equation? Are marketers getting their collective arms around the challenge of “branded content” ?

That challenge comes with four main hurdles:

Having something valuable to say

Having the resources to write it

Getting customers to find it/read it

Getting the entire company to agree on its value

You will find the above list nowhere else, even though a billion “Five Tips On Branded Content” posts have been published…this week.

It’s incidental, in any case, since 50% of marketers haven’t cracked the code on point #1, and 90% of the remaining 50% won’t rightfully address point #2.

So, there really is nothing to do with this topic but sit back and chuckle at research like the following:

In mid-December, an outfit called “The Custom Content Council” attempted to estimate what marketers spend churning out…er, custom content…coming up with an average of $1.9 million per company. Sorry, carry it out to another decimal place = $1.91 million.

On an absolute basis, that data point fails hurdle #1 above. But there were a couple of “relative” nuggets of value in the council’s research. To wit:

Around 25% of content spending was said to be in digital formats. Seems low, given the focus on email and website content, and implies there are still a lot of hardcopy newsletters, journals and such keeping the USPS barely afloat.

Around 25% of companies claim that custom content efforts consume 25% of their total marketing budgets. As the kids would say…ROTFLMAO.

February 28, 2012

When it comes to generating participation in contests, surely all of today’s marketers can leverage the various and sundry new-fangled digital tools, and jump the bar set by Scotch tape way back in 1956?

No, they cannot. And stop calling my Shirley.

Here are a few examples from just the past three months, that illustrate a profound lack of originality, brand utility, and business benefit.

Sickening
The only reference to foursquare we’ve come across this year: TheraMax asked users to “check in” using their smartphones…at a drug store where they would be looking for flu medicine?

No! At a TheraMax ad running in Times Square. Somehow, a company rep would find the checker-inners, and hand them a sample of meds. Even if they weren’t feeling flu-ish.

Not So Spice-y
McCormick figured the best way to get consumers to use its millions of spices this past holiday season would be contests like “The Big Cookie Share” and “The Merry Merry Menu Planner”…contests where people would bake real holiday treats?

No! Consumers were asked to (a) make a digital cookie, post it on Facebook and SHARE IT WITH YOUR FRIENDS; and (b) post two “theoretical” holiday menus to their Facebook page and SHARE IT WITH YOUR FRIENDS. [phrase in caps to be spoken in a desultory sing-songy fashion]

Gimme To The MAX
“Pepsi MAX for Life” (spokes-hacking: “a search for our most passionate fans”) allowed consumers to win a twelve-pack weekly, provided they submitted the best video…showing them actually drinking the product?

No! Just tell Pepsi why you deserve it. In a video that could be uploaded, SHARED WITH YOUR FRIENDS and voted on and whee whee whee all the way home.

Cold Coffee
Krups USA is again holding its "Krups Best Brew Awards,” in which people vote for the “best coffee shop across the nation.” The nominees are required…to use Krups coffee-making equipment in the store?

No? Whatever, dude. Just nominate and vote. But it can only be done on Krups’s Facebook page. Dude.

Chew Not On This
Quaker Chewy Granola Bars got together with heartthrob Nick Jonas to conduct an American Idol-like singing contest, given the God-awful name “Quaker Chewy Superstar.” The video winner had to…sing about the granola bar and/or eat one during the video?

No! Just sing, dammit. We’ll get to that stuff about helping grow the business later.

The Im-Moral Of The Story
Yes, digital user-content contests are free and ego-enhancing for marketers. But they are an abhorrent waste of time for the consumer, insulting his or her intelligence. Except, of course, for the ones who appear to possess very little (i.e., contest entrants).

Be original. Require real, not digital, product usage. Have a measurable benefit to the business. And don’t restrict your contest to Facebook, given that at least half your consumer base doesn’t go near it.

There you have it. Digitally. Now get out there, and SHARE IT WITH YOUR FRIENDS.

February 27, 2012

In what might become a week-long series, today’s post looks at the fever-pitch topic of “content.” Almost as prevalent as articles about Facebook, Pinterest, and “The Five Reasons You Need A Social Media Strategy,” you can’t surf very far without tripping over flotsam like this, from the current issue of B2B Magazine: “Content Marketing Becoming Vital.” zzzzzzzz.

Our perspective for today’s post looks at our old friend, user-generated content, which we took to the woodshed back in January of 2010. The most ironic thing about UGC over these last three years or so is that marketers believe they’ve invented something.

As with other digital marketing “innovations,” they are wrong. Consumers have been submitting “content” to brands for a very, very long time. The fact that it can now be done digitally doesn’t delete history.

Consider this date – July 11, 1956. That’s when 25 families from across the U.S. descended on Disney’s new California theme park for a free week of fun. Among them were the Barstows, whose nutty dad recorded the whole thing on film.

They got there by entering a promotion for 3M Scotch tape (or as we would call it today, by SUBMITTING USER-GENERATED CONTENT). All contestants needed to do was submit an entry that paid off on this half sentence: “I like “SCOTCH” Brand Cellophane Tape because…”

Little four-year-old Danny Barstow won for writing the words above and those below on a big poster:

WHEN SOME THINGS TEAR THEN I CAN JUST USE IT.

Actually, he didn’t write it himself. But he did add “DANNY” in all mismatched letters at the bottom.

Hard to know why 3M selected Danny as a winner. Probably because the Barstow family of five submitted SIX entries, all in one big-ass box. (As proof of how consumers have always been more clever than marketers, the Barstows cashed in their FOUR first-class tickets for FIVE seats in coach.)

The interesting footnote, as you might know, is that Barstow the elder put together a 34-minute 31-second documentary of the whole story in 1995 (and devotes the first six minutes or so to the family’s Scotch Tape contest shenanigans – see the film here).

In 2008, the Library of Congress selected the film, titled Disneyland Dream, for special preservation. How’s that for user-generated content?

And here’s something you don’t see with today’s contests. To enter, you had to submit proof of purchase of a roll of tape. Multiply the Barstow’s SIX rolls by the alleged million entrants (0.6% of U.S. population at the time), and you’ve got some real “social media ROI.”

One wonders about little Danny now, perhaps a grandfather. And about Danny III. No doubt wailing away at his iPad all day, entering dopey contests left and right.

February 24, 2012

Campbell Soup – Ouch In A Pouch
This is almost as fun as pounding on Demand Media. Campbell’s continues its years-long slump in soup sales, dropping another 2% in the quarter just ended January 29.

Having tried nearly everything to get out of the soup (including a sexy new website), Campbell’s just introduced “Go! Soup” in microwavable pouches. With popular, high-demand flavors like Coconut Curry (huh?) and Smoked Gouda (wtf?), it seems obvious in which direction its sales trend will continue to, um, “Go!”

Online Vide-OH!
Way back in the day, we were the first and only to notice the pending top end to Internet content consumption. Recent looks at the monthly comScore Video Metrix reports provoked us to cobble together a quick update.

In the year since November 2010, the online video audience rose by a whopping 6.3%, actually declining on a month-to-month basis five times within that period.

More important, of course, is the amount of time people devote to online videos. Check out these “minutes per viewer” data points for November 2011, compared to November 2010:

Hulu – down 5%

Microsoft (Bing) – down 12%

VEVO – down 16%

Of these, VEVO appears to be the most exposed. Interestingly, Facebook is allegedly courting VEVO for when the VEVO/YouTube partnership runs out at year end. Looks like YouTube will come out the winner if VEVO goes Facebook’s way.

Walmart Jumps The Wal
Yes, we bashed Walmart quite frequently (and deservedly) in 2008 and 2010. But loyal readers know we turned positive long before anyone else did, pointing to Walmart’s smart investments in marketing technology and human talent toward the end of 2011.

Tol. Ya. So.

Walmart just announced its second quarter in a row of same-store sales increases. While Wall Street beat the company up for a mere 0.1% drop in operating income, we spotted another great new hire – Neil Ashe, the former president of CBS Interactive and ex-CEO of CNET, has been brought on as president and CEO of Walmart Global eCommerce.

This is looking so good that if WMT drops $2 more in stock price, we’ll bring it into the Lairig Marketing Index. Speaking of which…

The Lairig Marketing Index – Buy! Buy! Buy!
Our recently revived index of best-in-class marketing companies, $1000 each of Buffalo Wild Wings, Harley-Davidson, LivePerson, and Monro Muffler purchased at the February 16th close, is already up 1.5% in just one week.

A very aware reader asked why we didn’t include JetBlue and Southwest Airlines, since we spoke so highly of each recently. Simple answer.

Take a gander at a ten-year stock chart of any airline. Ten years of takeoffs and landings, after which, like an episode of The Twilight Zone, you haven’t gone anywhere at all.

February 23, 2012

We can send men to the moon. We can, apparently, send a spaceship to Mercury and guide its orbit instantly FROM HERE.

We can send someone’s voice to you NO MATTER WHERE YOU ARE. And your voice can be sent back to them, in an instant, no matter where THEY are.

But we can’t do sh&t with batteries. They don’t last any appreciable, additional length of time than 50 years ago.

As consumers, we don’t seem to care. We throw 3 billion of them away every year. And replace them with 3 billion more.

We tolerate “battery paralysis.” How many Christmases have been ruined because of the lack of batteries? Who was the horrible prick that invented the phrase “batteries not included”?

The 3 billion doesn’t even include the modern-day stuff that is built into the products we use. That hand vacuum you recharge? Ever notice that after getting a good 20 minutes out of a full charge in the first year, it then quickly drops off to about 10 minutes, and steadily loses a minute per month from there?

Do you do anything other than tailor your clean-ups around the shortened time, sprinting around the living room before your ten minutes is up?

Anyone have a laptop battery that really lasted as long as claimed, even on day one? Within six months, the battery holds a charge for about 33 minutes. By end of year one, you spend your day running around town looking for a Starbucks that has not yet CEMENTED UP ITS ELECTRICAL OUTLETS (a story for another day).

So where does this put us with the emerging electric automobile? Which, oddly, doesn’t leverage any new "electric" technology – but is simply a chassis full of HUNDREDS OF OLD-STYLE BATTERIES.

They call it “range anxiety” – an EV driver’s fear that the car isn’t going to make it as far as the next nonstandard charging outlet.

What if these batteries end up performing like the ones in the hand vac? Or the laptop?

What if drivers find out they can never achieve the promised 100-mile range on a single charge, from day one? What if, during year two, they start to notice the car acting like a laptop, unable to last more than 50% of claimed duration?

How far will EV drivers compromise? “Yep, we own one of those. Of course, we only use it to go to the end of the driveway to get the mail, but we feel really good about helping to save the planet.”

And you thought those semi-annual laptop recycling events in your hometown were a hoot.

February 22, 2012

Judging by the nearly infinite number of articles about “attribution” recently, we’d say marketing analytics “thought leaders” are on a crusade. Their intent is to move marketers away from the easy focus on first-order metrics like banner clicks and email open rates, and focus them at the other end of the spectrum – on the “sales” that marketing can (hopefully) take credit for.

This is a bit misguided. And, frankly, becoming very boring and nearly unreadable. As an example, here is an excerpt from a recent MediaPost “Metrics Insider” column:

“On a basic level, attribution produces reports with data containing insights at a single dimension, such as channel “A” is contributing X% to your success, compared to channel “B” at Y% and channel “C” at Z%.”

That is at a “basic level,” mind you.

Missing in this discussion is what Lairig Marketing calls, technically, “the stuff in between.”

Here is an example, using a financial advisory firm for illustration.

Let’s assume the “sales” end of the advisor’s marketing cycle is a face-to-face meeting where a customer signs up for a $250 financial plan. Prior to that is an initial meeting with the advisor, where the only goal is to press for the second meeting.

Prior to that is a series of touches with calls to action that push the prospect forward. In reverse order from meeting #1 might be these marketing tactics: a download of a sample financial plan, which was driven by interaction with an asset allocation calculator on the firm’s website, which was driven by an email to the prospect, which was driven by a webinar in which the prospect’s email address was registered.

This is “the stuff in between” – planned marketing touches that can be measured precisely, to determine where improvements are needed to increase individual response rates and send more prospects to the next step…ultimately increasing the number of people who show up at the second, final meeting.

It can also inspire the addition of MORE stuff in between: “What if we sent a letter to the prospect confirming the appointment for the second meeting, throwing in a $15 Starbucks card to minimize cancellations?”

Instead of all this hard work, the “analytics attributors” believe they can automate data collection and analysis, and as a bonus, optimize the digital touch points (only). Ergo – they can prove that last month’s online banner campaign with a 0.09% click-through generated $24,550 in sales.

Oddly, that attribution effort results in more, not less, focus on clicks.

And all that “stuff in between”? Attribution pretty much leaves it as a big, black, unattributable box.

February 21, 2012

How did this one slip by? A new marketing concept, gone so far out of bounds, like your worst slice ever off the tee, that simply walking off the course seems a better option than hoping to find the ball and put it back in play.

Rip Van Winkle, phone home.

Perplexed by a recent article about something called “The Zero Moment of Truth,” detective work led us to an even perplexier finding. According to the Wall Street Journal, back in 2005 Procter & Gamble (a company which lately seems to be losing control of its marketing rudder) dubbed the in-store, at-shelf purchase decision as “The First Moment of Truth.”

A chap from Google by the name of Jim Lecinski saw that the time period in the marketing cycle prior to purchase was unclaimed. So he took out his calculator and, voila – “The Zero Moment of Truth” was born.

There is a 75-page ebook if you are interested. We could not make it beyond page three of Chapter One, which declared: “Now there’s a new critical moment of decision that happens before…”

None of this is new. And none of it is clear. The “zero” concept is all over the lot – sometimes a single moment, sometimes multiple; sometimes a decision point, sometimes only education; sometimes measured in seconds, sometimes in days.

When it is all said and done, though, “Zero Moment” is one blatant big-ass advertisement for Google. Which makes sense, given Licenski’s title – Head of Sales for Google.

Hard to say who has done a better job of butchering the moment of truth concept – Lecinski or P&G. In vogue well before 2005, and always plural we might add, MOTs occur throughout the marketing cycle, any time that a potential customer is about to make a conscious, committed, and significant decision to move forward, or not (in the latter case, this is termed a negative moment of truth).

With all due respect to the folks at Google, an MOT is just as, if not more, likely to occur offline as online. In addition, MOTs are driven by how well a marketer meets a customer’s expectations, rather than Google’s portrayal of a bunch of consumer-driven activities.

Done right – i.e., exceeding the customer’s expectations at the key moments of truth – a marketer can eliminate P&G’s dopey “First MOT.”

Not for nothing, but you would have thought a Google Advertising guy would have picked a better reference to “zero.”

February 17, 2012

That time of week, once again. Read ‘em and sleep.
[off Presidents’ Day; next post Feb 21]

Texans Hate Telephone Poles
In a June 2010 post we pointed out the significant but unexplained overindex of land-line cord cutters down thar in Texas. Recent data show the percent of people in places like San Antonio ditching Ma Bell continues to grow faster than a [insert your favorite witty Texas saying].

Cell-only households have now broken through the 40% level in Southwest and Central regions of Texas, compared to the U.S. average of 31%. Surprisingly, folks in Los Angeles continue to lag the average. Hollywood squares.

Turning The Funnel Upside Down. Again.
We gave “Thought Leader, Author and Entrepreneur” (his words) Joe Jaffe a good ripping for his book “Flip The Funnel” in early 2010. No surprise that he’s on to his “latest breakthrough for the marketing world” (his words).

Jaffe has created a middleman company that will coax large “brands” into investing in early-stage start-ups. He might generate some good press and pull in a nice commission or two, but it’s doubtful he’ll “flip the funnel” on venture capitalism. Marketing comes last in that world.

About.com’s Bout Of Suffering Continues
Last spring we noted the abysmal performance of the About.com division of The New York Times.

This one is the proverbial big fan with a lot of sh&t. Profits from the advertising About.com runs on its site continue to fall, faster than American Idol’s TV ratings. Last quarter’s revenue “growth” was negative. Again.

Management believes it has a sales force issue and will focus there. We still hold to our original analysis: (a) the site’s look and feel is vintage train wreck; (b) the content and ads are mostly crap.

One promising development – About sold off its garbage ConsumerSearch.com property, which we called “embarrassing” in our May post.

Klout Runs Out Of Clout
Last summer, we clobbered Klout, one of the zillion companies claiming to have the ultimate in influencer scoring. We essentially called it a house of cards.

Klout made its first acquisition recently, and it’s a sure sign that the buzzword of 2011 – “pivot” – is underway. The company it acquired has f&ck all to do with influencer scoring. Instead, Klout is now aiming at local search advertising – what the online cognoscenti deem the mother of all revenue opportunities.

February 16, 2012

Time to resurrect our faux stock index of companies with excellent marketing strategies and/or strong competitive advantages. We did OK with the initial Lairig Marketing Index, with three strong choices out of four – LivePerson, Harley-Davidson, and especially Monro Muffler.

We drowned in our fourth pick, Coldwater Creek (which continues to run dry, with a 9% same-store sales decline over the 2011 holiday period). An even performance overall, before we “sold off” the entire index.

Let’s start the resurrection by grandfathering back in LPSN, MNRO and HOG. At great risk, mind you, given the upward 45-degree trajectory all three have realized recently. Buy high, sell higher, hopefully.

Now, let’s add the country’s best kept bars-and-restaurant secret: BWLD. Forgive our calling it a secret, but there are no Buffalo Wild Wings in Manhattan. Just two locations, actually, across the five boroughs of New York City (JFK? Oh dear…).

Yet there are over 800 Buffalo Wild Wings elsewhere, with heavy penetration in Texas and the Midwest “Heartland” states. Each location appears to have roughly 800 TVs, giving new meaning to being “in the zone.”

Who else has been able to take this long, long, long wings “fad” (circa 1980) to such a beautiful extreme? Double-digit growth in just about every metric. Including stock price gain. Last week BWLD jumped 15 points, from $64 to $79. Still higher today, at $84-and-change. We’ll hop on it anyway. The Buffalo Wild Wings marketing strategy looks too good to pass up.

Start with its unbelievably interactive home page. Words can’t do it justice. See for yourself here. You’ll be there for hours.

Our dummy Facebook account provides access to BWLD’s Facebook brand page, which shows a trillion likes, excellent company posts, and a million comments and shares. This is a case study for Facebook engagement.

The company spends roughly 3% of net revenues on advertising. It has held that percentage steady over the past three years of torrid growth – no resting on its laurels.

And this – if BWLD can accomplish what it did during these years of economic craptasticness, just think what it can do when (if) we recover.

Two risks to consider. The biggest is the split in company-owned and franchised operation. At some point, franchisors always reach an inflection point where they need to rethink the balance between the two ownership types. As a corollary, there is always the potential for franchisee revolt as the business gets bigger and more complex.

The second risk is minor, and apparently under the radar: What will happen when fans of Buffalo Wild Wings discover that the company DOES NOT HAVE A SINGLE LOCATION IN BUFFALO !?!?!?!

Sorry Tonawanda and Hamburg (?!?!). I knew Buffalo, and you sirs, are no Buffalo.

February 15, 2012

The set-up to this story is pretty well known, so let’s summarize quickly:

The genius (get it ?!?!?) behind the Apple Store concept and execution, Ron Johnson, took the CEO role at J.C. Penney in November. Two months later he announced a complete business overhaul. The requisite change-of-logo and new brand theme.

Plus the requisite appointment of Ellen Degeneres as J.C. Penney spokesperson, making this her 428th company among the S&P 500 for which she holds such a role (that assumes she doesn’t sign on with Deere & Co. before this post gets, um, posted).

The real deal came in CEO Ron Johnson’s focus on merchandising, including pricing. Turning into “Fair and Square” and “Your Favorite Store” will be driven mainly via:

A simplified pricing structure

A massive store-within-a-store transformation

A critical component of the three-pronged pricing strategy is the elimination of deep-discount sales. Instead – *drum roll* – everyday low pricing. We’ve seen this “EDL” movie before. About a hundred times. It doesn’t end well. See Walmart. Several times.

Two-to-one odds JCP “modifies” its everyday-low approach by late September/early October 2012.

Much more problematic will be the retail renovations. From several of the media mentions of the new JCP comes this: “The company also plans to install 100 mini-shops in each location…” A hundred?

First, from a branding standpoint. Apple didn’t have to do any “brand” marketing these past several years. Instead, the sum of a TON of product marketing for iMacs and iPods and iPhones and iPads yielded a 1 + 1 + 1 + 1 = a zillion effect.

The sum of 100 stores-within-a-J.C.Penney-store will equal brand chaos.

Second, from an experience standpoint. Walking into an Apple store is akin to chancing upon a goat rodeo. But with infinite newly built space, walls of glass, brushed stainless, and handsome wood, it turns out to be a cool and innovative goat rodeo.

J.C. Penney doesn’t have the luxury of new space, or much time. How does J.C. Penney turn ONE HUNDRED stores-within-a-store into a branded experience, versus a “place to shop”?